[Congressional Bills 104th Congress] [From the U.S. Government Publishing Office] [H.R. 2900 Introduced in House (IH)] 2d Session H. R. 2900 To establish nationally uniform requirements regarding the titling and registration of salvage, nonrepairable, and rebuilt vehicles. _______________________________________________________________________ IN THE HOUSE OF REPRESENTATIVES January 25, 1996 Mr. White (for himself, Mr. Schaefer, Mr. Brown of Ohio, and Mr. Richardson) introduced the following bill; which was referred to the Committee on Commerce, and in addition to the Committees on the Judiciary and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned _______________________________________________________________________ A BILL To establish nationally uniform requirements regarding the titling and registration of salvage, nonrepairable, and rebuilt vehicles. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, SECTION 1. SHORT TITLE. This Act may be cited as the ``National Motor Vehicle Safety, Anti- Theft, Title Reform, and Consumer Protection Act of 1995''. SEC. 2. FINDINGS. The Congress makes the following findings: (1) Many States do not have specific requirements regarding the disclosure of a motor vehicle's salvage history and some States never require that the motor vehicle's title be stamped or branded to indicate that it is, or has been, a salvage vehicle. (2) Existing State disclosure requirements regarding a motor vehicle's salvage history are inconsistent in scope and language, require the use of various and different forms and administrative procedures, will undercut the effectiveness of the National Automobile Title Information System created by the Anti Car Theft Act of 1992, are burdensome on interstate commerce, and make it easy for unscrupulous sellers of rebuilt vehicles to mislead potential wholesale and retail buyers about the condition and value of such vehicles. (3) The fact that a motor vehicle is salvage, nonrepairable, flood damaged, or rebuilt after incurring substantial damage is material in any subsequent purchase or sale of that motor vehicle. (4) Some salvage and nonrepairable vehicles become involved in illegal commerce in stolen vehicles and parts. The lack of theft inspection in some jurisdictions for rebuilt motor vehicles before allowing the vehicles back on the road provides an opportunity for an unscrupulous person to use stolen parts in the rebuilding of motor vehicles. (5) According to the National Highway Traffic Safety Administration, rebuilt motor vehicles may not have passed any safety inspection and may pose a public safety risk and consumers who unknowingly buy these motor vehicles face an increased risk of death or serious injury. Statistics prepared by the American Association of Motor Vehicle Administrators indicate that 71 percent of the States require some form of safety inspection before a rebuilt salvage vehicle may be registered for use on the road. The promulgation of a safety inspection program by the Secretary of Transportation may assist the States in expanding and standardizing their inspection programs for rebuilt vehicles. (6) Duplicate or replacement titles play an important role in many vehicle thefts and various types of vehicle fraud. Accordingly, State controls on the issuance of such titles must be strengthened and made uniform across the country. (7) Large numbers of motor vehicles are exported from United States ports to foreign countries without proper documentation of ownership in violation of law. (8) In view of such threats to public safety and consumer interests, the Motor Vehicle Titling, Registration and Salvage Advisory Committee, which was convened under the auspices of the Secretary of Transportation pursuant to section 140(a) of the Anti Car Theft Act of 1992 (15 U.S.C. 2041 note), recommended that Federal legislation be enacted to require certain definitions to be used nationwide to describe seriously damaged vehicles, that all States be required to use these definitions in determining appropriate title designations, and that all States be required to use certain motor vehicle titling and control methods and to take certain other measures to protect the integrity of the titling process. SEC. 3. MOTOR VEHICLE TITLING AND DISCLOSURE REQUIREMENTS. Subtitle VI of title 49, United States Code, is amended by inserting a new chapter at the end: ``CHAPTER 333--AUTOMOBILE SAFETY, ANTI-THEFT, AND TITLE DISCLOSURE REQUIREMENTS ``Sec. 33301. Definitions ``For the purposes of this chapter: ``(1) Passenger motor vehicle.--The term `passenger motor vehicle' means any vehicle driven or drawn by mechanical power manufactured primarily for use on the public streets, roads, and highways, including a multipurpose passenger vehicle or light duty truck when that vehicle or truck is rated at not more than 6,000 pounds gross vehicle weight, except that such term does not include a motorcycle. ``(2) Salvage vehicle.--The term `salvage vehicle' means any passenger motor vehicle which has been wrecked, destroyed, or damaged to the extent that the total estimated or actual cost of parts and labor to rebuild or reconstruct the passenger motor vehicle to its pre-accident condition and for legal operation on the roads or highways exceeds 75 percent of the retail value of the passenger motor vehicle, as set forth in a current edition of any nationally recognized compilation (to include automated databases) of retail values, as approved by the Secretary. Such term shall not include any passenger motor vehicle having a model year designation of a calendar year which is at least 5 years prior to the calendar year in which the vehicle was wrecked, destroyed, or damaged. The value of repair parts for purposes of this paragraph shall be determined by using the published retail cost of the original equipment manufacturer parts or the actual retail cost of the repair parts to be used in the repair. The labor cost of repairs for purposes of this paragraph shall be computed by using the hourly labor rate and time allocations that are reasonable and customary in the automobile repair industry in the community where the repairs are performed. Such term includes, without regard to whether such passenger motor vehicle meets the 75 percent threshold specified in the first sentence-- ``(A) any passenger motor vehicle to which an insurance company acquires ownership pursuant to a damage settlement (not to include a settlement in connection with a recovered theft vehicle unless such passenger motor vehicle sustained sufficient damage to meet the 75 percent threshold specified in the first sentence); or ``(B) any passenger motor vehicle whose owner may wish to designate as a salvage vehicle by obtaining a salvage title, without regard to the extent of the passenger motor vehicle's damage and repairs. Such designation by the owner shall not impose on the insurer of the passenger motor vehicle or on an insurer processing a claim made by or on behalf of the owner of the passenger motor vehicle any obligation or liability. ``(3) Salvage title.--The term `salvage title' means a passenger motor vehicle ownership document issued by the State to the owner of a salvage vehicle. Ownership of the passenger motor vehicle may be transferred on a salvage title, however, a passenger motor vehicle for which a salvage title has been issued shall not be registered for use on the roads or highways unless it has been issued a rebuilt salvage title. A salvage title shall be conspicuously labeled with the word `salvage' across the front. ``(4) Rebuilt salvage vehicle.--The term `rebuilt salvage vehicle' means-- ``(A) any passenger motor vehicle which was previously issued a salvage title, has passed State anti-theft inspection, has been issued a certificate indicating that the passenger motor vehicle has passed the required anti-theft inspection, has passed the State safety inspection in those States requiring a safety inspection pursuant to section 33302(b)(7), has been issued a certificate indicating that the passenger motor vehicle has passed the required safety inspection in those States requiring such a safety inspection pursuant to section 33302(b)(7), and has a decal stating ``Rebuilt Salvage Vehicle-- Anti-theft and Safety Inspections Passed'' affixed to the driver's door jamb; or ``(B) any passenger motor vehicle which was previously issued a salvage title, has passed a State anti-theft inspection, has been issued a certificate indicating that the passenger motor vehicle has passed the required anti-theft inspection, and has, affixed to the driver's door jamb, a decal stating ``Rebuilt Salvage Vehicle--Anti-theft Inspection Passed/No Safety Inspection Pursuant to National Criteria'' in those States not requiring a safety inspection pursuant to section 33302(b)(7). ``(5) Rebuilt salvage title.--The term `rebuilt salvage title' means the passenger motor vehicle ownership document issued by the State to the owner of a rebuilt salvage vehicle. Ownership of the passenger motor vehicle may be transferred on a rebuilt salvage title, and a passenger motor vehicle for which a rebuilt salvage title has been issued may be registered for use on the roads and highways. A rebuilt salvage title shall be conspicuously labeled either with the words ``Rebuilt Salvage Vehicle--Anti-theft and Safety Inspections Passed'' or ``Rebuilt Salvage Vehicle--Anti-theft Inspection Passed/No Safety Inspection Pursuant to National Criteria,'' as appropriate, across the front. ``(6) Nonrepairable vehicle.--The term `nonrepairable vehicle' means any passenger motor vehicle which is incapable of safe operation for use on roads or highways and which has no resale value except as a source of parts or scrap only or which the owner irreversibly designates as a source of parts or scrap. Such passenger motor vehicle shall be issued a nonrepairable vehicle certificate and shall never again be titled or registered. ``(7) Nonrepairable vehicle certificate.--The term `nonrepairable vehicle certificate' means a passenger motor vehicle ownership document issued by the State to the owner of a nonrepairable vehicle. Ownership of the passenger motor vehicle may only be transferred 2 times on a nonrepairable vehicle certificate. A passenger motor vehicle for which a nonrepairable vehicle certificate has been issued can never be titled or registered for use on roads or highways. A nonrepairable vehicle certificate shall be conspicuously labeled with the word `Nonrepairable' across the front. ``(8) Flood vehicle.--The term `flood vehicle' means any passenger motor vehicle that has been submerged in water to the point that rising water has reached over the door sill and has entered the passenger or trunk compartment. Disclosure that a passenger motor vehicle has become a `flood vehicle' shall be made at the time of transfer of ownership and the next certificate of title issued after such transfer shall be conspicuously labeled with the word `flood' across the front. ``Sec. 33302. Passenger motor vehicle titling ``(a) Carry-Forward of Information on a Newly Issued Title Where the Previous Title for the Vehicle Was Not Issued Pursuant to New Nationally Uniform Standards.--For any passenger motor vehicle, the ownership of which is transferred on or after the date that is 1 year from the date of the enactment of this chapter, each State, in licensing such vehicle for use, shall disclose in writing on the certificate of title whenever records readily accessible to the State indicate that the passenger motor vehicle was previously issued a title that bore any word or symbol signifying that the vehicle was `salvage', `unrebuildable', `parts only', `scrap', `junk', `nonrepairable', `reconstructed', `rebuilt', or any other symbol or word of like kind, or that it has been damaged by flood. ``(b) Nationally Uniform Title Standards and Control Methods.--Not later than 18 months after the date of the enactment of this chapter, the Secretary of Transportation shall by rule require each State, in licensing any passenger motor vehicle where ownership of such passenger motor vehicle is transferred more than 2 years after publication of such final rule, to apply uniform standards, procedures, and methods for the issuance and control of titles for motor vehicles and for information to be contained on such titles. Such titling standards, control procedures, methods, and information shall include the following: ``(1) A State shall indicate on the face of the title or certificate for a passenger motor vehicle, as applicable, if the passenger motor vehicle is a salvage vehicle, a nonrepairable vehicle, a rebuilt salvage vehicle, or a flood vehicle. ``(2) Such information concerning a passenger motor vehicle's status shall be conveyed on any subsequent title, including a duplicate or replacement title, for the passenger motor vehicle issued by the original titling State or any other State. ``(3) The title documents, the certificates and, decals required by section 33301(4), and the issuing system shall meet security standards minimizing the opportunities for fraud. ``(4) The certificate of title shall include the passenger motor vehicle make, model, body type, year, odometer disclosure, and vehicle identification number. ``(5) The title documents shall maintain a uniform layout, to be established in consultation with the State or an organization representing them. ``(6) A passenger motor vehicle designated as nonrepairable shall be issued a nonrepairable vehicle certificate and shall not be retitled. ``(7) No rebuilt salvage title shall be issued to a salvage vehicle unless, after the salvage vehicle is repaired or rebuilt, it complies with the requirements for a rebuilt salvage vehicle pursuant to section 33301(4). Any State inspection program designed to comply with this paragraph shall be subject to continuing review by and approval of the Secretary. Such inspection program shall include the following: ``(A) A passenger motor vehicle owner submitting a vehicle for an anti-theft inspection shall be required to provide a completed document identifying the vehicle's damage prior to being repaired, a list of replacement parts used to repair the vehicle, and proof of ownership of such replacement parts, as may be evidenced by bills of sale, invoices or, if such documents are not available, other proof of ownership for the replacement parts. The owner must also include an affirmation that the information in the declaration is complete and accurate and, to the knowledge of the declarant, no stolen parts were used during the rebuilding. ``(B) Any passenger motor vehicle or any major part or major replacement part required to be marked under section 33102 having a mark or vehicle identification number that has been illegally altered, defaced, or falsified, and that cannot be identified as having been legally obtained (through bills of sale, invoices, or other ownership documentation), shall be contraband and subject to seizure. To avoid confiscation of parts which have been legally rebuilt or remanufactured, the Secretary of Transportation, in consultation with the Attorney General, shall, as part of the rule required by this section, establish procedures for dealing with those parts whose mark or vehicle identification number is normally removed during industry accepted remanufacturing or rebuilding practices, which parts shall be deemed identified for purposes of this section if they bear a conspicuous mark of a type, and applied in such a manner, as designated by the Secretary indicating that they have been rebuilt or remanufactured. With respect to any vehicle part, the Secretary's rule, as required by this section, shall acknowledge that a mark or vehicle identification number on such part may be legally removed or altered as provided for in section 511 of title 18, United States Code, and shall direct inspectors to adopt such procedures as may be necessary to prevent the seizure of a part from which the mark or vehicle identification number has been legally removed or altered. ``(C) The Secretary shall establish nationally uniform safety inspection criteria to be used in those States requiring such a safety inspection. A State may determine whether to conduct such safety inspection itself, contract with a third party, or permit self- inspection, all subject to criteria promulgated by the Secretary hereunder. A State requiring such safety inspection may require the payment of a fee for the privilege of such inspection or the processing thereof. ``(8) No duplicate or replacement title shall be issued unless the word `duplicate' is clearly marked on the face thereof and unless the procedures for such issuance are substantially consistent with Recommendation three (3) of the Motor Vehicle Titling, Registration and Salvage Advisory Committee. ``(9) A State shall employ the following titling and control methods: ``(A) If an insurance company is not involved in a damage settlement involving a salvage vehicle or a nonrepairable vehicle, the passenger motor vehicle owner must apply for a salvage title or nonrepairable vehicle certificate, whichever is applicable, before the passenger motor vehicle is repaired or the ownership of the passenger motor vehicle is transferred, but in any event within 30 days after the passenger motor vehicle is damaged. ``(B) If an insurance company, pursuant to a damage settlement, acquires ownership of a passenger motor vehicle that has incurred damage requiring the vehicle to be titled as a salvage vehicle or nonrepairable vehicle, the insurance company must apply for a salvage title or nonrepairable vehicle certificate within 15 days after the title is properly assigned by the owner to the insurance company and delivered to the insurance company with all liens released. ``(C) If an insurance company does not assume ownership of an insured's or claimant's passenger motor vehicle that has incurred damage requiring the vehicle to be titled as a salvage vehicle or nonrepairable vehicle, the insurance company shall, as required by the applicable State, either (i) notify the owner of the owner's obligation to apply for a salvage title or nonrepairable vehicle certificate for the passenger motor vehicle and notify the State passenger motor vehicle titling office that a salvage title or nonrepairable vehicle certificate should be issued for the vehicle, or (ii) withhold payment of the claim until the owner applies for a salvage title or nonrepairable vehicle certificate. ``(D) If a leased passenger motor vehicle incurs damage requiring the vehicle to be titled as a salvage vehicle or nonrepairable vehicle, the lessor must apply for a salvage title or nonrepairable vehicle certificate within 21 days after being notified by the lessee that the vehicle has been so damaged, except when an insurance company, pursuant to a damage settlement, acquires ownership of the vehicle. The lessee of such vehicle shall inform the lessor that the leased vehicle has been so damaged within 30 days after the occurrence of the damage. ``(E) Any person acquiring ownership of a damaged passenger motor vehicle that meets the definition of a salvage or nonrepairable vehicle for which a salvage title or nonrepairable vehicle certificate has not been issued, must apply for a salvage title or nonrepairable vehicle certificate, whichever is applicable. This application must be made before the vehicle is further transferred, but in any event, within 30 days after ownership is acquired. The requirements of this subparagraph shall not apply to any scrap metal processor which acquires a passenger motor vehicle for the sole purpose of processing it into prepared grades of scrap and which so processes such vehicle. ``(F) State records shall note when a nonrepairable vehicle certificate is issued. No State shall issue a nonrepairable vehicle certificate after 2 transfers of ownership. ``(G) When a passenger motor vehicle has been flattened, baled, or shredded, whichever comes first, the title or nonrepairable vehicle certificate for the vehicle shall be surrendered to the State within 30 days. If the second transferee on a nonrepairable vehicle certificate is unequipped to flatten, bale, or shred the vehicle, such transferee must, at the time of final disposal of the vehicle, use the services of a professional automotive recycler or professional scrap processor who is hereby authorized to flatten, bale, or shred the vehicle and to effect the surrender of the nonrepairable vehicle certificate to the State on behalf of such second transferee. State records shall be updated to indicate the destruction of such vehicle and no further ownership transactions for the vehicle will be permitted. If different than the State of origin of the title or nonrepairable vehicle certificate, the State of surrender shall notify the State of origin of the surrender of the title or nonrepairable vehicle certificate and of the destruction of such vehicle. ``(H) When a salvage title is issued, the State records shall so note. No State shall permit the retitling for registration purposes or issuance of a rebuilt salvage title for a passenger motor vehicle with a salvage title without a certificate of inspection, which complies with the security and guideline standards established by the Secretary pursuant to paragraphs (3) and (7), as applicable, indicating that the vehicle has passed the inspections required by the State. This subparagraph does not preclude the issuance of a new salvage title for a salvage vehicle after a transfer of ownership. ``(I) After a passenger motor vehicle titled with a salvage title has passed the inspections required by the State, the inspection official will affix the secure decal required pursuant to section 33301(4) to the driver's door jamb of the vehicle and issue to the owner of the vehicle a certificate indicating that the passenger motor vehicle has passed the inspections required by the State. The decal must comply with the permanency requirements established by the Secretary. ``(J) The owner of a passenger motor vehicle titled with a salvage title may obtain a rebuilt salvage title and vehicle registration by presenting to the State the salvage title, properly assigned, if applicable, along with the certificate that the vehicle has passed the inspections required by the State. With such proper documentation and upon request, a rebuilt salvage title and registration shall be issued to the owner. When a rebuilt salvage title is issued, the State records shall so note. ``(10) A seller of a passenger motor vehicle that becomes a flood vehicle shall, at or prior to the time of transfer of ownership, give the buyer a written notice that the vehicle is a flood vehicle. At the time of the next title application for the vehicle, disclosure of the flood status shall be provided to the applicable State with the properly assigned title and the word ``Flood'' shall be conspicuously labeled across the front of the new title. ``(11) In the case of a leased passenger motor vehicle, the lessee, within 15 days of the occurrence of the event that caused the vehicle to become a flood vehicle, shall give the lessor written disclosure that the vehicle is a flood vehicle. ``(c) Electronic Procedures.--A State may employ electronic procedures in lieu of paper documents whenever such electronic procedures provide the same information, function, and security otherwise required by this section. ``Sec. 33303. Funding ``(a) In General.--Funds otherwise made available to the States for the promotion of highway safety may be used to defray the direct costs of establishing new procedures for compliance with section 33302. ``(b) Report.--The Secretary shall, contemporaneously with the issuance of a final rule pursuant to section 33302(b), report to the President of the Senate and the Speaker of the House of Representatives whether the costs to the States of compliance with such rule can be met by user fees for issuance of titles, issuance of registrations, issuance of duplicate titles, inspection of rebuilt vehicles, or for the State services, or by earmarking any moneys collected through law enforcement action to enforce requirements established by such rule. If such costs cannot be so met, user fees should be mandated at the Federal level but retained by the States to cover the direct costs to comply with such rule. ``Sec. 33304. Petitions for extensions of time ``The Secretary may grant a State, for good cause shown, an extension of time to comply with the requirements established in section 33302(a). No such extension shall remain in effect on or after the compliance date established pursuant to section 33302(b). ``Sec. 33305. Effect on state law ``(a) In General.--Effective on the date the rule promulgated pursuant to section 33302 becomes effective, the provisions of this chapter shall preempt all State laws, to the extent they are inconsistent with the provisions of this chapter or the rule promulgated pursuant to section 33302, which-- ``(1) set forth the form of the passenger motor vehicle title; ``(2) define, in connection with a passenger motor vehicle (but not in connection with a passenger motor vehicle part or part assembly separate from a passenger motor vehicle), any term defined in section 33301 or the terms `salvage', `junk', `reconstructed', `nonrepairable', `unrebuildable', `scrap', `parts only', `rebuilt', `flood', or any other symbol or word of like kind, or apply any of those terms to any passenger motor vehicle (but not to a passenger motor vehicle part or part assembly separate from a passenger motor vehicle); and ``(3) set forth titling, recordkeeping, anti-theft inspection, or control procedures in connection with any salvage vehicle, rebuilt salvage vehicle, nonrepairable vehicle, or flood vehicle defined in section 33301. ``(b) Construction.--Additional disclosures of a passenger motor vehicle's title status or history, in addition to the terms defined in section 33301, shall not be deemed inconsistent with the provisions of this title. When used in connection with a passenger motor vehicle (but not in connection with a passenger motor vehicle part or part assembly separate from a passenger motor vehicle), any definition of a term defined in section 33301 which is different than the definition in that section or any use of any term listed in subsection (a), but not defined in section 33301, shall be deemed inconsistent with the provisions of this chapter. Nothing in this chapter shall preclude a State from disclosing on a rebuilt salvage title that a rebuilt salvage vehicle has passed a State safety inspection which differed from the nationally uniform criteria to be promulgated pursuant to section 33302(b)(7). ``Sec. 33306. Civil and criminal penalties ``(a) Prohibited Acts.--It shall be unlawful for any person knowingly and willfully to-- ``(1) make or cause to be made any false statement on an application for a title (or duplicate title) for a passenger motor vehicle; ``(2) fail to apply for a salvage title when such an application is required; ``(3) alter, forge, or counterfeit a certificate of title (or an assignment thereof), a nonrepairable vehicle certificate, a certificate verifying an anti-theft inspection or an anti-theft and safety inspection, or a decal affixed to a passenger motor vehicle pursuant to section 33302(b)(9)(I); ``(4) falsify the results of, or provide false information in the course of, an inspection conducted pursuant to section 33302(b)(7); ``(5) offer to sell any salvage vehicle or nonrepairable vehicle as a rebuilt salvage vehicle; or ``(6) conspire to commit any of the acts enumerated in paragraphs (1), (2), (3), (4), and (5). ``(b) Civil Penalty.--Any person who commits an unlawful act as provided in subsection (a) of this section shall be fined a civil penalty of up to $2,000 per offense. ``(c) Criminal Penalty.--Any person who commits an unlawful act as provided in subsection (a) of this section shall be fined up to $50,000 or sentenced up to 3 years imprisonment or both, per offense.''. SEC. 4. DOCUMENTATION REQUIRED TO EXPORT CERTAIN VEHICLES. Section 627(b) of the Tariff Act of 1930 (19 U.S.C. 1627a(b)) is amended to read as follows: ``(b)(1) Customs officers shall not allow the export of a self- propelled vehicle from the United States by transport, unless the exporter presents proof of ownership to a Customs officer. Proof of ownership shall be limited to an unencumbered title or nonrepairable vehicle certificate issued by a governmental jurisdiction or to a manufacturer's statement of origin. If the self-propelled vehicle title is encumbered, the exporter must also present written permission from the lienholder to export the self-propelled vehicle. Customs officers shall not allow export of any self-propelled vehicle prior to verifying that the self-propelled vehicle has not been reported stolen. Customs officers will provide the vehicle identification number for all self- propelled vehicles that are exported to the National Crime Information Center and the National Automobile Title Information System. ``(2) Failure of a person attempting to export a self-propelled vehicle to comply with this subsection shall subject such person to a civil penalty of not more than $500 for each violation.''. <all> HR 2900 IH1S----2